2010年7月6日星期二

Bank of China to Raise Funds in Hong Kong and Shanghai

"Bank of China to Raise Funds in Hong Kong and Shanghai | AboutHK.Com - More Information About HK"

Sunil Kashyap

Bank of China to Raise Funds in Hong Kong and ShanghaiOn Friday a person aware of the situation stated that Hong Kong and Shanghai stock markets are the places from where Bank of China Ltd. is looking to raise funds. It is another move to shore up its capital base after an explosion in lending last year.

Bank of China Ltd shares were halted from trading in Hong Kong after a report the nation’s third- largest lender by value plans to raise as much as 60 billion Yuan ($8.9 billion) in a rights offer to replenish capital.

Caixin Online reported yesterday that the Beijing-based lender will sell the shares in Shanghai and Hong Kong, without citing anyone. According Caixin Bank of China’s board approved the sale of stock to existing shareholders on June 30 and the company will make an announcement today.

A sale by Bank of China would do damage to the market sentiment and banking shares further because they have already been flooded by share offerings, as told by Tang Yayun, aShanghai -based analyst at Northeast Securities Co. The person said that one of China’s Big Four state-owned banks, Bank of China, which is also the biggest issuer of new loans in the government-led credit boom last year, is still undecided whether to raise funds via a rights issue or a sale of new shares.

Just a month after it raised 40 billion Yuan ($5.9 billion) from a sale of bonds that will be converted into its Shanghai-traded shares, the latest fundraising plan came into being. According to Chairman Xiao Gang, Bank of China wouldn't need to raise fresh funds on the mainland stock market after the completion of the debt sales. The Hong Kong listed shares of Bank of China's were stoppedfrom trading on Friday, but the lender didn't give a reason.

According to a spokeswoman from Bank of China the bank would possibly issue a statement regarding the share suspension later in the day.

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